ACGA Issues New Suggested Gift Annuity Rates

Summary

The Board of Directors of the American Council on Gift Annuities has approved a new schedule of suggested maximum gift annuity rates for gifts established on or after July 1, 2011.

Published in May 2011

Full Text:

In April, the Board of Directors of the American Council on Gift Annuities (ACGA) approved a new schedule of suggested maximum gift annuity rates for gifts established on or after July 1, 2011. The new schedule reflects (1) the Council’s long-standing residuum target of 50%, with an additional requirement that the present value of the residuum be at least 20% of the gift amount; (2) the results of a recent study on charitable gift annuitant mortality conducted by the ACGA’s actuarial consultants, the Hay Group, and (3) a more conservative investment return assumption. Generally speaking, the new rate schedule contains slightly lower rates for single-life annuities for ages 69 and younger, and slightly higher rates for single-life annuities at ages 75 and older. Similar changes apply to 2-life gift annuity rates. A copy of the one-life rate schedule is attached, and the schedules will appear on the ACGA web site as well.

A full explanation of the assumptions underlying the ACGA’s new schedule will be published shortly in a paper entitled “Explanation of the ACGA Gift Annuity Rates Effective July 1, 2011.” You will be able to find the paper on the ACGA web site at www.acga-web.orgif you are a sponsor, or you will be able to order the rates paper on the web if you are not a sponsor. Please direct any questions to the ACGA at acga@acga-web.org or 770-874-3355.